Axa Wealth Family self-invested personal pension members have flocked to other providers following the company's closure of its pooled fund flexibility option.
In August a probe by HM Revenue & Customs was behind the halting of a pooled fund flexibility option run by Axa Wealth which could allow people to avoid tax.
The option was withdrawn from the Family Suntrust product that Axa Wealth ran with effect from 2 September and was announced in a note to advisers late last month.
The Retirement Wealth Account and Family Suntrust - Sipps the firm was running - also closed to new business at the same time, which Axa said was in preparation for the sale of the Axa Wealth businesses later in the year.
Following these closures, members have been contacting other providers to find out if there are other options.
John Fox, director at Liberty Sipp, said: "We've had lots of enquiries and six new clients came in last week requesting to transfer from Axa Family Sipp."
Martin Tilley, director of technical services at Dentons, said: "Our business development managers have been approached, I suspect about 10 to 12 times to ask if we operate a similar arrangement. We have explained that we don’t and they have gone away.
"We have said we are open to taking cases on into our own products but we have not picked any up from Axa yet."
According to Axa Wealth, 3,000 clients hold the Retirement Wealth Account Sipp and there are just over 1,000 Family Suntrust Schemes with 3,000 participants.
The Retirement Wealth Account has more than £1bn funds under management.
Mr Tilley explained the product has been used where a person has gone over the lifetime allowance for their pension - currently £1.25m - and can be used to avoid the 55 per cent tax charge that would apply by passing money down the generation to another family member.
For example, if a couple had a £3m fund and gets £200,000 worth of growth, it is not split between the members like it would be when it is an allocation, but is mainly given to the children so the parent’s funds do not get larger and do not pay tax.
Mr Tilley said: “Under any reading and interpretation of the regulations and the law that we have come up with that is something called value shifting - that is shifting value from one person to another.
“Basically the Treasury is losing out, so we think it is a mechanism for avoiding tax - it appears that the (HM) Revenue have been investigating this and may have now come to the same conclusion.”
